Manufacturing Stocks and Forward-Looking Expectations in the UK.
This paper derives a model of the stocks plan based on optimal behavior by the firm when facing adjustment costs with forward-looking expectations formation. Estimates of the model are reported for manufacturing, using three alternative expectations mechanisms for determining expected sales: time se...
| Asıl Yazarlar: | , , |
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| Materyal Türü: | Journal article |
| Dil: | English |
| Baskı/Yayın Bilgisi: |
1986
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| Özet: | This paper derives a model of the stocks plan based on optimal behavior by the firm when facing adjustment costs with forward-looking expectations formation. Estimates of the model are reported for manufacturing, using three alternative expectations mechanisms for determining expected sales: time series; published forecasts (derived from National Institute published forecasts); and rational expectations. The latter uses a submodel dependent on weakly exogenous variables. Single equation and whole model comparisons are made of the stocks equation estimated with forward expectations versus a traditional backward-looking model. These favor the forward-looking model. |
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